Pushy ‘Assistance’ from Banks
Many families are shown to be nearly twice as in debt than they were only 7 years ago. The average Briton now owes £33,000 as opposed to the £17,000 owed in 2000, according to international accountancy firm, PricewaterhouseCoopers.
With the rise in property prices and mortgage repayments, many families are feeling the affects of a global credit squeeze which experts warn will continue for some time. If the struggle to survive financially was not enough hardship for most households, now banks are increasing pressure manoeuvres on many customers to pay more than they can afford.
The Citizens Advice Bureau (CAB) has been replete with customers who report being upset about the ‘aggressive tactics’ being used by banks on those in debt.
One such customer of HSBC complained about the continuous phone calls and harassment he received after repeatedly rejecting the bank’s ‘managed loan’ proposal which included a 13% interest rate - twice as much as he is currently paying. Although HSBC agreed to the amount he was able to pay, the bank would only accept the terms if he signed up for the managed loan offer.
In addition, HSBC also sent numerous letters with claims of wanting to help customers in financial trouble when their aggressive behaviour suggested differently.
Even the BBC has discovered many cases of customers begin hassled by their banks after putting a debt repayment plan in place. Often the banks pressure customers to agree to costly loans to immediately repay the debt - which goes against the advice of debt charities.
On their part, HSBC responded by saying ‘as a responsible lender HSBC only offers a managed loan to customers when all other lending options have been exhausted’.
The British Bankers’ Association (BBA) commented that banks are always willing to work along side debt advice charities to help their customers, however CAB often finds their customers still receive harassing phone calls and letters.
In many cases the CAB has heard of customers who attempt to work with their banks and offer to make payments, but the bank asks for more than they can afford. Even after the bank has worked with a debt advice charity, the customers continue to be pressured to pay more in higher interest products.